Canada's Natural Gas Industry Could Be Worth $1 Trillion

CBC

Posted:
12/17/2012 4:23 pm EST
Updated:
02/16/2013 5:12 am EST

Canada's natural gas industry will rival the oilsands and generate more than a quarter of a million jobs a year for the next two decades, says one of Canada's most influential business think-tanks.(Alamy photo) | Alamy

Canada's natural gas industry will rival the oilsands and generate more than a quarter of a million jobs a year for the next two decades, says one of Canada's most influential business think-tanks.

The Conference Board of Canada published an analysis Monday that expects Canada's natural gas industry to add more than $1 trillion to Canada's economy over the next 24 years and support an average of 260,000 jobs a year over that time frame.

The ambitious projection factors in all the direct investment, but also ancillary spinoffs down the supply chain and figures all regions of the country stand to benefit, even those provinces without any large natural gas holdings.

Demand set to rise

The industry already produces $24.5 billion a year and employs 130,000 people. That's already good enough to make up 42 per cent of the country's energy exports, but demand is expected to double between now and 2035.

The board estimates the industry is going to invest $386 billion to keep up with demand over that time frame. If that projection holds true, that's more than the $364 billion worth of investment that the board says the oilsands are going to attract over the same period.

"In all, Canada's natural gas industry is expected to add a cumulative $940 billion to Canada's economy over the next 24 years, and generate roughly 6.2 million person-years of employment.," the board said in its report. "In other words, the industry is expected to support employment of nearly 260,000 jobs per year over the 24-year forecast horizon."

Much of that is likely to come from the two provinces with extensive gas holdings — B.C. and Alberta, the report says. But there will be spinoff benefits across the country, and governments at all levels will reap tax revenues on top of the GDP bump.

After undergoing a boom earlier this decade, natural gas prices have been flatlining for several years after new technologies have made vast shale gas holdings suddenly economical. That's created a supply glut that's holding down prices.

Natural gas was going for $3.36 per million British thermal units in New York on Monday, well off the highs of around $12 seen before the recession of 2008.

Although only seven per cent of the direct investments will occur in Ontario, the province is forecast to receive 18 per cent of the resulting employment and 16 per cent of the wage increases.

"The entire country benefits, even though the benefits are focused the most where natural gas is produced," the report reads.

Over the 24-year horizon, natural gas investments will help generate 560,000 person-years of employment in Ontario, and 199,000 person-years of employment in Quebec. Saskatchewan is expected to support 92,400 person-years of employment and Manitoba 39,200 person-years. The smallest employment effects are forecast for Atlantic Canada.

Also on HuffPost:

Close



Best & Worst Provincial Climate Change Policies

of





Here's a look at the best and worst climate change policies in Canada, as ranked by the David Sazuki Foundation. All info comes from the report "All Over The Map 2012." (CP)

"Quebec is still leading the field in many areas, including being the first province to enact a modest cap-and-trade system on industrial GHG emissions, although its commitment to expanding oil and gas exploration and road and highway building threaten progress and its standing." (Alamy)

"Ontario's pioneering Green Energy Act is already reaping environmental and economic benefits for the province and could serve as a blueprint for other jurisdictions" (GEOFF ROBINS/AFP/Getty Images)

"Top-ranked in 2008, B.C., although it leads the country on pricing carbon pollution, has lost momentum and stalled on implementing measures to ensure it meets its 2020 reduction target with the threat of shale gas and the potential development of a gas-powered LNG terminal that could undermine the province's leadership." (PUNIT PARANJPE/AFP/Getty Images)

"Although concerns remain about past failures, Nova Scotia has taken important steps, including a hard cap to reduce GHG emissions from the power sector." (Tim BREAKMEIE/AFP/Getty Images)

"Although Manitoba has shown some leadership on energy efficiency, there have been too many broken promises and half (if any) measures to reduce emissions from major sources." (Flickr: Jezz's Photostream

"Progress has stalled in New Brunswick with a change of provincial government. It remains to be seen whether the new government will continue to stall, go forward or go backward." (Luke Pinneo/Getty Images)

"The government of the Northwest Territories still relies more on subsidies than regulations, but it has made a commitment to increasing renewable energy and is considering a carbon tax." (Chris Jackson/Getty Images)

"Although the government of Newfoundland and Labrador has, more so than many jurisdictions, led by example in tackling its own emissions, its long-awaited updated action plans detail no concrete steps to tackle and reduce emissions from major sources." (Flickr: magnolia1000)

"The territory of Nunavut still has no GHG reduction targets and has failed to include promising measures in official strategies." (Flickr: courosa)

"Despite an admirable goal for government of Yukon operations to be carbon neutral by 2020, there are no territory-wide GHG reduction targets or plans to tackle emissions from industry." (Flickr: Andrewsaurusrex)

"Alberta's commitment to heavily polluting, damaging and unsustainable fossil fuel industries continues unabated with a recent analysis showing the province is only on track to achieve one third of its pollution-reduction target for 2020." (MARK RALSTON/AFP/Getty Images)

"It is difficult to imagine any jurisdiction taking the threats of climate change less seriously than Saskatchewan currently does." (Flickr: Just a Prairie Boy's photostream)